The Group has a 1.5% life of mine GRR over three exploration tenements in the central Pilbara region of Western Australia owned by a wholly-owned subsidiary of BHP Billiton Limited (‘BHP Billiton’), which is dual-listed on the LSE and ASX.
The Pilbara royalties are over undeveloped tenements of BHP Billiton’s iron ore operations in Western Australia. The Group was encouraged that BHP approached the Company in 2016 to seek certain consents to advance the tenements towards planning, an indication that BHP is moving this asset towards production.
We were further encouraged by BHP ’s announcement on June 26, 2017 that they were approving capex of $184 million to commence funding its South Flank project. Although this does not bring mining within the Group’s royalty licences, it does indicate that BHP are now moving in this direction. The expansion will leverage the existing infrastructure around Mining Area C.